Maryland condominium associations may not use condominium amenities to enforce condominium assessment payment

The Maryland Court of Appeals issued a decision on June 23, 2017, discussing the extent to which a condominium association may impose restrictions on a unit owner’s right to access common amenities of the condominium.    In Elvation Towne Condominium Regime II, Inc. v. Rose, the court looked at a condominium association with a “suspension-of-privileges” rule, by which the association prohibited unit owners from parking overnight on the property or using the pool during periods when the owner was delinquent in paying condominium fees.  The unit owners bringing this case were alleged to be in arrears in making require payments of assessments, so the association not only sued the owners for the amount owed in the District Court of Maryland, but also barred them from overnight parking or use of the pool.  The owners brought their own suit against the condominium association in Circuit Court, seeking a declaratory judgment striking down the prohibition against use of common amenities.

The Court of Appeals held that a Maryland condominium association may restrict access to common areas and amenities as a means to enforce payment of condominium fees, but only if this enforcement mechanism is expressly provided for in the condominium’s declaration.  This was not the case here, because the action was taken based only on a rule enacted by the condominium’s board. Therefore, the court would not allow this enforcement mechanism against these particular owners.

In making this decision, the court wrestled with whether a “suspension-of-privileges” rule constitutes a taking of property, requiring more than a rule-making under the Maryland Condominium Act.  The court held that, when a rule disparately affects a portion of unit owners by revoking a property interest they acquired when they purchased their units, without affecting the rights of other unit owners, there is a taking of property.  The court went on to find that restricting a condominium owner’s access to community-held property is a significant infringement of the owner’s property rights, which may only be authorized by a provision in the condominium’s declaration, and not be a rule making.